Mindanao rates seen rising by as much as P4/kWh

Gov’t allots P4B for co-ops’ acquisition of generators


Energy Secretary Carlos Jericho L. Petilla

Power rates in Mindanao may shoot up by as much as P4 a kilowatt-hour should the electric cooperatives on the island agree to the proposed solution of the government for them to acquire their own diesel-fired generators.

On the sidelines of a meeting with Mindanao-based electric cooperatives yesterday, Energy Secretary Carlos Jericho L. Petilla noted that the price increase would be felt only during the short-term and would vary depending on how long the generators would run. The estimated range of P1.80 to P4 a kWh assumed that the modular generators would be running four to 10 hours a day.

Mindanao suffers from daily outages lasting two to six hours. As of Tuesday, the power supply deficit stood at 155 megawatts.

“I’m giving [the cooperatives] as many choices as I can. Unfortunately, there isn’t much. There will be power in Mindanao in 2015 but under certain conditions. And the conditions are basically for the electric cooperatives to have contracted new capacities,” Petilla said. “So the option from now up to 2015 is to rent or purchase gensets, which are going to be very expensive.”

“Electric co-ops are not obliged to choose one option. They can choose not to choose. That means the people will suffer. There are electric co-ops that said that they can’t raise prices so they would rather have the brownouts. So far, 20 out of 24 electric co-ops are [amenable to the options],” he further said.

Although the proposed solution remained an option for the electric cooperatives, Petilla stressed the need to acquire the gensets as utilities must have their own embedded capacities that could be tapped in time of emergencies.

The energy chief added that the renting or buying of gensets was the most immediate solution to the worsening power crisis in Mindanao, out of a total of three that were presented again in a meeting yesterday.

The other two solutions included the Interruptible Load Program (ILP), wherein entities with excess capacities can use their power facilities, instead of sourcing power from the main grid, and the Interim Mindanao Energy Market (IMEM), which will serve as a trading platform where entities can sell their excess capacities, subject to compensation based on market prices.

According to Petilla, the Department of Energy has earmarked P4 billion for the gensets. The budget will be sourced from the Malampaya funds and will be given to electric co-ops in the form of loans.

Mindanao-based electric co-ops are given three options, the first of which (Option 1) is to rent the gensets at an estimated cost of P1.4 million a megawatt a month. The available gensets can generate 1 to 2 MW and Petilla said he expected some 35 MW of genset capacities to be readily available by end-April.

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  • JuanCitizen

    The Natl Gov’t cannot say it did everything it could to avert the power crisis in Mindanao. If it can subsidize the MRT and build flyovers in Metro Manila, why can’t it build a power plant for Mindanao? Private power investors were holding back their own power projects to force the Mindanao people to accept higher power rates. Why didn’t the government intervene when this was so obvious? Just to even dredge the Agus river to increase capacity would have been enough. All those people in Manila did was hold useless meetings. Taunan na ‘to. Mga sin berguenza!

  • aspirin200

    The MRT and LRT fare will always be subsidized by government because increasing the rate will trigger demand for higher wages not just in Manila but in the entire NCR. Fares are paid by commuters daily and the impact to the daily minimum wage is immediately felt.

    Electricity is another matter because the impact is not felt until the monthly bill is received and paid and is not one of the factors used in the determination of minimum wage by the Wage Board. A sad thing is that the power rate increase will carry with it an increase in the VAT that government collects and which is really ironic as government will earn more out of Mindanao people’s suffering.

    Mindanao consumers are burdened further by unequal taxation. Gasoline and diesel pump prices in Mindanao are P4.00 to P5.00 per liter higher than in Manila. Meaning that Mindanao consumers pay an additional P0.48 to P0.60 per liter or P4.80 and P6.00 of additional VAT per ten liters compared to that which is paid by Manila consumers. If there are 2 million vehicles in Mindanao consuming 10 liters per day, the additional VAT will amount to P960,000 to P1.2 million per day or P3.5 billion to P4.38 billion additional VAT burden per annum that Manila motorists don’t have to bear.

    Say, 10 years of suffering, the inequity will provide the government of at least P35 billion windfall, more than enough money to solve the island’s power problem or for Mindanao coops to buy and refurbish all the Agus and Pulangi Hydro plants.

  • virgoyap

    If solution of Mindanao power shortage have been tried some several years ago then this has been solve long time ago. Only that the NPC is sleeping and doing nothing to look for a permanent solution about it.

  • Oliver82

    Buy that New Gensets. Mababayaran at mababayaran din yan. Demand shortage na nga pinaiisipan pa?

  • ovalboy

    Di na baleng magkanda leche leche ang mga buhay ng tao dito sa Mindanao basta kumita lang ang Aboitiz at Alcantara families. Di ba Miss Amy Remo?
    Everytime you, Miss Amy Remo churn out press releases like this from your PR client, nagkakanda leche leche ang buhay namin dito sa Gen. Santos City!!!!

  • BatangSingapore

    yan na sinasabi ko, papasukin nyo ba naman ang mga swapang na intsik sa mindanao at ngayon kakatasin kayo diyan ng kanilang mga negosyo.

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